The USD is just going downhill from Bernanke's miserable 'policies'. They have basically printed out billions of dollars with not enough Gold backing and pretty much the value of their fiat is by faith only. Even S&P are thinking of reevaluating the rating of USD. News of that sent USD tumbling down fm 1.04 to 1.07 and probably more. IF and when they do remove USD from AAA, imagine what happens when all the funds/firms who have to hold a certain % of AAA in their portfolio sell the USD for something AAA like AUD? Massive supply of USD on the market and massive demand for AUD (or other AAA stuff). Excess supply and no demand for USD = fun times. The amount of Gold which the US holds is: 8,133.5 tonnes; approx value at 1,500 /ozt = $378,207,750,000 http://en.wikipedia.org/wiki/Official_gold_reserves It really won't support Bernanke's massive printing spree imo. He has printed trillions and only has around 400 billion worth in Gold. Edit: WOW I just read wikipedia about this guy.... @ http://en.wikipedia.org/wiki/Ben_Bernanke Emphasis mines. Do you still trust your USD?
I've just looked at the charts, all week having massive rises, but not falling back much, these more violent movements make me nervous!
Here's to hoping that's not until the end of year or similar. I want to own a bit more silver before it gets too high!
True that! Seeing prices up at 45 really hurts my wallet It saddens me to think that in a years time we might be looking back and saying "WOW 45 was SO CHEAP; its 200 now!"
If it did rise to $200 a barrel I think the US would have no choice but to default on it's currency. The conflict in Libya has pushed the price of oil from around $95US to $110US. Libya supplies 2 percent of the worlds oil, of which 85% goes to Europe. http://en.wikipedia.org/wiki/Chart_of_exports_and_production_of_oil_by_nation http://www.cnbc.com/id/41907189/Libya_Oil_Production_Outage_Exports_and_Customers Now I think the real concern is Saudi Arabia, which is only 2800km from Libya (the distance from Cairns to Sydney). Saudi is only separated from Libya by Eygpt, which is in a state of turmoil as we know. If the people of Saudi decide they have had it with their governmemt as well then we will see the price of oil go ballistic. http://www.msnbc.msn.com/id/42013013/ns/world_news-mideast/n_africa/ http://www.sitesatlas.com/Maps/Maps/MEast.htm Also the Suez Canal in itself has about 5% of the world's oil flow through it, and the straight of Hormuz near Dubai has around 20% of the world's oil flowing trough it. http://www.deepgreencrystals.com/images/GlobalOilChokePoints.pdf (Yes I know...it's Lehman Brothers! :])...see page 5 of the PDF Should Iraq or Iran decide to use the Strait of Hormuz as a choke point against Saudi, this would lead to the price of oil going ballistic as well http://www.presstv.ir/detail/175903.html...but surprise surprise, guess who has a major naval base just down the road from the Strait of Hormuz in Bahrain http://en.wikipedia.org/wiki/United_States_Fifth_Fleet So let's say the price of oil does go to $200 a barrel...The possibilty may be thay the US can no longer afford to buy oil from the middle east, and from that we might see real hyperinflation in the US and the default of the US dollar. Then what? My guess is a new currency which is backed by gold, and the oil price being measured by gold as well....just my line of thinking anyway. BTW..great forum you guys have here! :]
Because there isn't a real shortage of oil. The price is being driven by speculators playing off of geopolitical events. If oil was trading purely on supply and demand it would likely be in the $60-70 range, if not lower. One of the biggest issues I have with oil trading is the lack of position limits. In my opinion, oil trading should be limited to end users.
There is one thing that will keep an artificial floor to the pricing. It is the price dealers are paying for physical. When a delear buys silver at $40 today, they would want to sell at $45 to make the profit. If the spot price tanks, then silver comes off the market. IE. If it goes under $40, they will continue to list it at $45. Or they will not sell it at all. They will take new orders, provided it can be sourced upstream for the new price. So there is an artificial price barrier, its the price that the silver was bought at. Which is the current price. If there is no stock to backup the lower spot prices. Then simply, you cannot get it at the low spot paper price. Such a simple concept here, if people are not forced to sell. They won't sell at a loss, Silver goes into hiding when spot price drops. Look at 2008, you can't buy at the low price. Slam
